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Court ruling has local impact

Thursday, May 3, 2012

A ruling by the Missouri Supreme Court over sales tax charges by the Department of Revenue will cost Barry County over $100,000 a year.

In January, the Missouri Supreme Court ruled in favor of Craig Street, a Springfield attorney who protested the Missouri Department of Revenue's practice of charging local sales tax on vehicles purchased outside of Missouri.

The court ruled state sales tax is limited to purchases within state borders. The ruling, which went into effect on March 21, impacted the provision that states motor vehicles sales are "to be deemed consummated at the address of the owner."

The ruling applies only to sales tax. Counties that have adopted a use tax, which collects on out-of-county transactions, will not be affected.

Lawrence County has a use tax. Barry County does not.

Sales taxes have been collected at the license offices in Monett and Cassville. According to Jamie Stephens, manager of the Monett License Office, the Missouri Department of Revenue sent notification that the collection formula had changed. The rate in the computer was altered based on the court ruling.

The license office receives revenue from processing fees, not from a portion of the taxes collected. Stephens said license office income would not be impacted by the change.

Barry County's two half-cent sales taxes will be impacted. According to Barry County Treasurer Lois Lowe, revenue from the tax for general county operations and for road and bridge maintenance will each lose between $60,000 and $65,000 a year.

"The sad thing is we didn't pursue the use tax since it was voted down," Lowe said. "If the use tax had passed, we'd still be getting this money. I think people buying vehicles should either pay a use tax or sales tax."



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